Pennsylvania budget impasse effect

Gov. Tom Wolf warns state employees, contractors and public about pending budget impasse

HARRISBURG — As Republicans complete their alternative state budget, Democratic Gov. Tom Wolf appears likely to veto at least some of it.

Now, with the midnight deadline for fiscal accord just hours away, it's high time to ask: How would a Harrisburg budget impasse affect people, local governments, businesses and nonprofits from Easton to Erie and Philadelphia to Pittsburgh?

Turns out it depends, really, on how long the impasse goes on.

The state's 500 school districts could still operate using their own property tax revenue, which they will start seeing in early July. But if the stalemate stretches for months, as it did in 2009 during the Rendell administration, school districts will start to suffer because local tax revenue will be drying up and state funds will not have been sent.

Various nonprofit organizations also may have to dip into reserves or take out bank loans to cover expenses.

"A likely budget delay is very concerning," according to Samantha Balbier, executive director of Greater Pittsburgh Nonprofit Partnership, an umbrella group for agencies that serve the needy. "Nonprofit organizations that receive state money should take precautionary measures in order to avoid disruptions and damage as a result of a delay."

On Monday, the Wolf administration sent letters to state employees and government contractors advising them of the ramifications of a budget stalemate. The administration also created a separate question-and-answer sheet advising the public — from the governor's perspective — about how a budget impasse may affect them.

In a letter, the administration told employees to continue reporting to work. In another letter, contractors were told to contact the state's Payable Services Call Center for information about invoices at 1-877-435-7363 or by email at RA-PSCPaymentInquire@pa.gov.

The public was told that social service programs will continue to operate, law enforcement will not be compromised, and state parks and prisons will remain open.

"I understand that this process might bring hardship, but we are doing everything in our power to ease the burden on our partners and come to an agreement as quickly as possible," Wolf said in a statement. "Thank you for your understanding and patience during this process."

GOVERNOR'S Q&A

Q: Will a budget impasse create any risks to the general public?

A: No. The state will operate all critical functions that impact the health, safety and welfare of citizens.

Q: Will a budget impasse affect public access to any state-owned or operated-facilities?

A: No. The following will remain open: state parks, county assistance offices, prisons, youth development facilities and PennDOT locations.

Q: Will the state pay its bills?

A: The state will continue to make payments and continue operations in all areas that affect the health, safety, and protection of Pennsylvanians or as required under federal law, state court decisions or the Pennsylvania constitution. That includes payments for: Social services benefits such as unemployment compensation, cash assistance, support for Women, Infants and Children (WIC); Medicaid and Medicare services; subsidies for home- and community-based child, senior and disability care; prescription drug coverage under the PACE program and pension programs for blind and paralyzed veterans; early intervention, autism and intellectual disability services for children and adults; state Workers' Insurance Fund payments, employee payroll and pension contributions.

Q:What about payments for non-mandated programs and services?

A: Contractors should continue to submit invoices for service, but payments will not be made until a 2015-16 budget is reached. Most state contracts include language that says contractors are forbidden from stopping work or refusing to make delivery in light of a budget impasse. Contracts also include language protecting contractors from default due to the budget impasse.